5 things you need to know about Making Tax Digital for Income Tax (MTD IT)?

Big changes are coming to the way millions of people report their income tax. If you're self-employed or a landlord, Making Tax Digital for Income Tax (MTD IT) could affect you from April 2026. Here’s what you need to know — and how to get ahead of the game.

5 things you need to know about Making Tax Digital for Income Tax (MTD IT)?

Big changes are coming to the way millions of people report their income tax. If you're self-employed or a landlord, Making Tax Digital for Income Tax (MTD IT) could affect you from April 2026. Here’s what you need to know — and how to get ahead of the game.

‍

1. What is MTD IT and what does it involve?

Making Tax Digital for Income Tax is part of HMRC’s move to digitise the UK tax system. Instead of filing a single tax return once a year, affected individuals will need to:

  • Keep digital records of their income and expenses
  • Submit updates to HMRC every quarter
  • Complete a final declaration at the end of the tax year

HMRC’s aim is to reduce errors and make tax reporting more accurate and efficient  - but it does mean a change in how you manage and report on your finances.

‍

2. Who is affected from April 2026?

From 6 April 2026, MTD for Income Tax will apply to individuals who are:

  • Registered for Self-Assessment, and
  • Income of more than £50,000 a year from self-employment and/or property

If your income from these sources is over £30,000, you’ll be brought into the system from April 2027.  See the HMRC website for more information.

‍

3. HMRC isn’t issuing free software – so you’ll need to get your own

Under MTD IT, you must use compatible software to keep records and submit your quarterly updates.

Unlike the current Self Assessment system, HMRC is not offering a free tool and is removing access to the existing gateway. You’ll need to find software that works for your needs – and make sure it’s recognised by HMRC.

‍

4. What will you have to do?

Here’s a quick overview of what’s expected under MTD IT:

  • Maintain digital records of your income and allowable expenses using approved software
  • Send updates to HMRC every three months – even if you’ve made no profit or had no activity
  • Submit a final declaration after the end of the tax year, replacing the current Self Assessment return

This means more frequent interaction with HMRC, but it also gives you a clearer picture of your tax position throughout the year.

‍

5. Introducing TaxNav – try it early, for free

To help you prepare, TaxNav is one of the first software tools to be recognised by HMRC for MTD IT.

TaxNav is built for people who rent out property or work for themselves. It’s:

  • Free for early adopters until April 2026 who start before October 2025
  • Fully browser-based – no downloads needed
  • Compatible with Excel spreadsheets (others to follow soon)
  • Designed to guide you step-by-step through MTD IT, including those all-important quarterly updates and final declaration

Most importantly, you stay in control – TaxNav doesn’t see your tax account  historical data.

‍

We can help

If you’re affected by MTD IT, getting set up early can make the transition smoother. With tools like TaxNav offering early access and support, now is a great time to prepare.


👉 Learn more at taxnav.digital

‍